The Department for Work and Pensions has issued a warning to claimants, saying it is looking at “developing fraud risks” and would “pursue anyone who attempts to defraud the taxpayer using the full range of our authorities.”
The Department for Work and Pensions has issued an alert to benefit claimants who may be attempting to take advantage of a £1,500 gap in Universal Credit.
During the pandemic, certain families in need of additional income were eligible to get advance payments of up to £1,500 on three separate occasions.
People were able to obtain many of these Universal Credit loans despite not being eligible due to an error in the application procedure.
Applicants were often looking for a way to supplement their income and were contacted by fraudsters posing as employees of job centres or personal loan advisers.
The fraudsters received a £500 part of each £1,500 advance in return for helping them enter false information.
The breach led to a flood of applications for bogus advances, which were widely circulated on social media.
Due to the financial constraints caused by the pandemic, there has been a recent surge of interest in finding ways to earn extra money.
“The overwhelming majority of Universal Credit claims are genuine, and fraud and errors in the benefits system remain extremely low, with 96.5 per cent of payments being paid correctly,” a DWP spokesperson told News Live.
According to the DWP, specialist teams have been set up to tackle certain types of fraud.
To mitigate the dangers, the Department for Work and Pensions (DWP) has set up an Enhanced Checking Service, which includes 600 experienced fraud detectives.
This means that any dubious cases are sent to benefits processing staff for examination and verification. According to the DWP, this service has made progress in tackling any potential misuse of the system.
The agency also works with online platforms to remove posts that encourage fraud.
It also uses social media to promote fraud awareness and educate individuals about the need to protect their identities.
The Department for Work and Pensions (DWP) previously told News Live that it has put in place measures to combat widespread benefit fraud across the UK.
It is believed that £20m in advance fraud has taken place, with up to 10,000 cases a month.
DWP staff stated that money was going out at a rate of £1,500 per claim “like lottery prizes”, with many of the claims clearly being made under false identities.
How to get extra money from Universal Credit legally
The Department for Work and Pensions (DWP) offers a variety of schemes for benefit recipients who need additional funds.
In addition, in some situations, there are a variety of additional payments available, including top-ups of up to £405 from October to replace the previous severe disability premium.
If eligible, claimants who previously received PDS will have their Universal Credit payments increased by £120, £285 or £405.
Those who self-isolate in Covid hotspots or who have been advised to self-isolate by NHS Test and Trace may get more benefits.
However, more general financial support is also available; here are some examples of what you can apply for:
1. Advance payment
If you need money to meet bills and other household expenses while you are waiting for your first Universal Credit payment, you can apply for an advance payment up to the full amount of the first advance payment.
You can apply for an advance payment through your Jobcentre Plus Job Coach or through your online account.
You will need to
- Describe why you need an advance loan.
- Confirm your identity (you will do this when you apply online or over the phone with a job coach).
- give the details of the bank account for the advance (talk to your job coach if you cannot open an account).
You must pay the money back through deductions from your Universal Credit payments within 12 months.
If you are currently receiving Universal Credit and you have informed the DWP of a change in your circumstances that means you are due to receive more money but have not yet been given the higher amount, you may be entitled to an advance.
2. Plan your budget in advance
You can also opt for a Budget Advance to help you:
- Replacing a broken cooker is an example of an unexpected household expense.
- Getting a job vs. keeping a job
- funeral expenses
A Budget Advance is a loan that must be repaid with your monthly Universal Credit payments: your benefits will be reduced until you repay it.
The lowest loan amount available is £100. You can reach the following levels:
- If you are single, the cost is £348.
- If you are in a couple, the cost is £464.
- If you have children, the cost is £812.
The amount you can receive is determined by whether you can
- you can repay the debt
- you have savings above £1,000 (the DWP will reduce your loan offer by £1 for every £1 of funds above the £1,000 level).
To qualify for a Budget Advance, you must have the following:
- Unless you need the money to help you start a new job or keep a current job, you have been receiving Universal Credit, income-related Employment and Support Allowance, Income Support, income-related Jobseeker’s Allowance or State Pension Credit for 6 months or more.
- In the previous 6 months, I earned less than £2,600 (£3,600 for couples).
- all previous Budget Advances were paid.
Contact your Jobcentre Plus Job Coach to apply for a Budget Advance.
3. Budgeting Loan
Benefit recipients can also find out about a Budgeting Loan, although it is not a scheme available to Universal Credit recipients.
To qualify for a Budgeting Loan, you must have received one or more of the following benefits in the previous six months
- Cash benefit (Income support)
- Jobseeker’s Allowance is means-tested (Income based jobseeker´s allowance)
- Income-related ESA (Employment and Support Allowance)
- Pension Credit
You will not be able to get a Budget Loan if:
- If you have Universal Credit, you must apply for a Budget Advance instead.
- You are in the middle of a strike again (for example, a strike, work stoppage or lockout).
- You owe a total of more than £1,500 in Crisis and Budget Loans.